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December 26, 2017

Steady & improved coal supply has led to a revival of Indian power plants, ensuring uninterrupted power supply

Indian power plants now have average coal inventory of about nine days, comfortably breaching the critical stock threshold that forced several generating companies to recently shut down units amid a crisis in supplies of the primary solid fuel.

“Supplies have improved considerably and a large number of our units at power stations have been brought back up,” a senior executive at top state-run generating company NTPCBSE 0.90 % said. “These units were either operating at very low capacity levels or idling due to the lack of coal. We have been receiving additional rakes since the last few days, helping scale up generation.” Another executive at an independent power producing company said: “Supplies have regularised and are increasing at a slow and steady pace. We are now being able to plan better since we know how much coal we are to receive on a daily basis.”

According to the Central Electricity Authority (CEA), stocks are considered critical if they fall below five days for pit-head plants. For non-pit-head plants, the threshold is less than a week.

According to the Central Electricity Authority , there are no pit-head plants with critical stocks while in the non-pit head category, there are just about 10-odd plants against 27 two months ago.

All these plants, however, are receiving supplies on a regular basis and a senior Coal IndiaBSE -0.47 % executive said it will take some time before these plants start to build up stock as the fresh supply of coal is almost entirely being used up for generating power.

“Coal India has been loading anything between 275 and 280 rakes a day, including loading from private washeries and goods sheds. Direct loading from pit heads has been hovering around 250 rakes a day and we are aiming to increase that to about 270,” said a Coal India executive.

Factors that helped improve stocks at power plants include the onset of winter, which led to reduced demand in certain pockets, and increased production. However, land acquisition issues at the Rajmahal mine area under Eastern Coalfields in West Bengal are still affecting coal production. Law and order issues at collieries under Central Coalfields have also considerably affected loading. The closure of a 34-kilometre railroad stretch between Dhanbad and Chandrapura in Jharkhand is also affecting supplies.

The alternate route being used involves moving coal via trucks to another loading area. Coal from this region is sent to power plants in West Bengal, Odisha, and north India, including Punjab, Haryana and Uttar Pradesh. The region also supplies coal to plants of the Damodar Valley Corporation.